Regulation of early gene expression in phage Lambda is mediated by termination and antitermination of transcription. Towards a better understanding of the transcription termination/antitermination mechanism, the Rho-dependent, tRI terminator, along with its regulatory sequences, was cloned onto a plasmid. Deletions of various lengths into the terminator segment were generated in vitro; the deletion end points were sequenced. Deletions that remove the terminator (or part of it) express a distal gene at higher levels than when transcription terminates. Interestingly, a region far upstream to the tRI terminator and its regulatory sequences is shown to be required for the process of transcription termination. This new, and as yet unreported, DNA region is believed to be a possible Rho protein interaction site. The regulatory factor, N, antiterminates transcription from nutR, a site located in the tRI region. In order to study the effect of the same deletions on the Lambda N protein-mediated, transcription antitermination activity, a Rho-independent, tI terminator was cloned in between the tRI terminator and the distal structural gene. N protein was provided from a single copy of Lambda on the E. coli chromosome. Interestingly, this amount of N allowed complete antitermination at tRI alone. The combination of tRI and tI, however, was only read through 10% of the time. In other contexts, tI alone is read through 100% when acted upon by N. Gene regulation at the level of transcription initiation was studied with the Lambda pRE promoter. The Lambda promoter requires positive activation by the Lambda cII protein. Mutations generated in vitro in this promoter relieved it from its dependence on cII protein for activation. In addition, cII now repressed the cII-independent character of the mutant.